Industrial park funding to rule Modi-Xi talks at BRICS meet

Expediting investments in the proposed industrial parks would be the main focus of the talks between Prime Minister Narendra Modi and Chinese President Xi Jinping when they meet on the sidelines of the BRICS (Brazil, Russia, India, China and South Africa) Summit.

The Sixth BRICS summit is scheduled to take place in Fortaleza and Brasilia in Brazil on July 15-16. The bilateral meeting between Modi and Xi is scheduled on the first day itself, sources said. The matter would also be discussed at the BRICS Business Forum on July 14, where a significant number of Indian businessmen would be represented. The BRICS Business Council comprises five senior businesspersons from each member-country in the grouping. A memorandum of understanding (MoU) for Chinese companies to invest in industrial parks and zones here was signed during Vice-President Hamid Ansari’s visit to Beijing last month. But no proposal was forthcoming on the quantum of investment.

A high-ranking official said on condition of anonymity: “The government, it seems, has completed all due diligence regarding these industrial parks — where will these parks be set up, which cluster will be set up in which state and so on. So we need to expedite the process and want them to invest here quickly.” The official said India was keen to attract “large-scale Chinese investments, especially in the electronics production segment”, to propel the manufacturing sector. The growth of this sector has remained stagnant at 15 per cent of gross domestic product. The BJP-led government is keen on attracting investments to boost a sagging economy. The dispensation is pinning hopes on these industrial parks to bring in foreign capital, give a push to growth in manufacturing and generate jobs.

According to the terms of the MoU, the industrial zones would be given incentives similar to those given to the special economic zones and the National Investment and Manufacturing Zones . These zones would basically provide platforms for cluster-type development of enterprises of the two countries.

India had been pushing the Chinese to set up industrial parks here for over a year now. The idea was first mooted by former Prime Minister Manmohan Singh and the proposal was taken up with the Chinese during the visit of Premier Li Keqiang here in May last year.

An objective of these industrial parks would be to arrest the surging trade deficit with China, which touched $137.05 billion and $190.33 billion in 2012-2013 and 2013-2014, respectively.